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Shannon: Enda Speaks
Read more about: Connaught-Ulster, End of Shannon-Heathrow, Fine Gael, Government, Local Government, Munster, Northern Ireland, Transport, Travel & Tourism
A fairly comprehensive statement today from the up-to-now quiet Enda Kenny on SNN-LHR. Perhaps some of the time was spent reconciling the position that FG will now adopt with their non-opposition to the Aer Lingus privatization (although they had complaints at the time about how it was managed). A few interesting things in Enda’s statement, in particular an indication that they will be trying to squeeze Willie O’Dea. [UPDATED]
Willie is directly referenced for his Cromwell remark –
Enda Kenny said that the comment by a Fianna Fail Minister who compared Aer Lingus executives to Cromwell did the region no favours and was used to deflect attention away from the Government’s responsibilities to protect well established national interests.
And he along with the FF BMW delegation is put on notice that rhetorical bluffs will be called when the Dail resumes –
Fine Gael will be pursuing the Government to demand that it keeps its promises to protect strategically important transport links and we will use our new Dail strength to test the sincerity of the Fianna Fail TDs and ministers in the mid west region who claim to support the retention of the Shannon-Heathrow service.
We’ll know more on Tuesday which apparently is when Aer Lingus management will announce their decision regarding EGM. One issue that the government must surely be thinking about is disposal of the 25 percent share, as they have no answer to the question of what it is for.
The risk of course is that Ryanair could buy it. Ryanair may well be thinking that the grounds for disqualification of its earlier bid by the EU have been exposed. Aer Lingus clearly has no specific commitment to maintaining operations in the Republic, and the very same Open Skies agreement that allows them to base anywhere would allow competitors to come into the newly expanding Dublin Airport, undercutting the argument that separation of Ryanair and Aer Lingus is needed for competition.
On a separate note, here’s the interesting case of the new Berlin airport, whose management is annoyed because Lufthansa is refusing to give it long-haul service. Emirates is keen to enter and run flights to Dubai, but Lufthansa and the German government see that as encroachment on their desire to maintain traffic through their hubs (Munich and Frankfurt). There are of course many differences with Shannon — one being that the airport has a powerful regional government to advocate for it. Ireland’s lack of true decentralisation strikes again.
UPDATE: Ahead of schedule (notification was not expected till next week — a toss into the weekend news cycle?), the Aer Lingus board has rejected Ryanair’s call for an EGM. The rationale for the denial leaves it open to the government to call for one, as it refers to Ryanair using its shareholding to change the strategy of a competitor to its own benefit.
FINAL UPDATE: Very strange. Aer Lingus apparently went to the media with their rejection of the EGM before notifying Ryanair. However Ryanair seem set to argue that they can convene an EGM anyway. This one is headed to the courts.
A little birdie told me about a comment made by Bertie off the record as he was leaving this week’s cabinet meeting.
Bertie to senior Cabinet Minister: If there isn’t a new route sorted by January, We’re f.%^ed
With FG on the ball today and seeing as Enda’s the only leader to have visited Shannon, it looks like there is still a lot left to play for.
I am now completely confused. Fine Gael are completely in favour of complete privatization of public transport in Dublin, but are now in favour of nationalisation of an airline. So, which is it from Fine Gael? Conservativism or a la carte conservatism? The Fine Gael stance on Shannon is popular in the west and an easy stance to take right now for the opposition, but how does it sit with FG policy overall. Do they now support semi privatization or partial privatization on most issues? Are FG left or right now?
I’m confused.
Dan, who is FG, was saying that the government should stay out of Aer Lingus affairs. Are FG the new FF? Comments here for the past while have questioned why FF are providing both the government and the opposition views and now we have FG providing both the government and the oppositon views.
When the Government decided to part privatize Aer Lingus it justified its decision on the basis that the national interest would be protected by the retention of a 25% shareholding. It is in the national interest that the Aer Lingus maintains the Shannon to Heathrow route. So there is no contradiction in FGs stance. It is now calling on the Government to use the 25% shareholding in the national interest as was promised at privatisation. IF Aer Lingus were a fully privatised company and if FG voted for full privatisation then FG could not justify any attempted state interference. The State is still a large shareholder so it is as entitled as any other shareholder to defend its interests. A certain bogus orthodoxy appears to have developed around this issue.
On privatisation in general it may make sense to privatize some services but not others. Even the Socialists in countries such as Sweden and Spain accept this approach.
James, I would like you to cite for us all where FG have said they “are completely in favour of complete privatization of public transport in Dublin,” or indeed that they “are now in favour of nationalisation of an airline.”
and where did I say that “the government should stay out of Aer Lingus affairs. ”
I don’t think you’re “confused”, I think you’re finding it hard to keep up with your own efforts at distorting what people are saying.
John and Dan. First of all, I agree with the privatization of some services and not others. what I am referring to is the fact right now that Enda Kenny has just said that the government should tell Aer Lingus what to do. That is nationalization of the airline by any standards.
As for going over the top on using the word ‘complete’ - apologies, I did have a few jars on board last night.
However, it still seems to me to be a la carte conservativism, with FG taking the same stance as FF - i.e. both sides of the argument.
You did say on your blog, Dan, that Aer Lingus were dead right to pull out on a commercial basis - I interpreted thius to mean that it would be wrong for the government to intervene and that it was coming from the conservative ideology, but this was my interpretation, so maybe I was wrong. Perhaps you were saying that Aer Lingus were doing the right thing for them and the government should force them to do the wrong thing for them. I’m not going to accuse you of being illogical.
This statement, however, seems to me to be at odds with Enda kenny’s stance. If Enda proposes that the government intervene and attempt to control the airline, then he doesn’t agree that Aer Lingus were right in any way, I would have thought.
This contrasts with the dublin bus issue. The FG proposal in 2006 was to offer 25% of the bus routes in Dublin to tender every three years. This means a complete tendering of all the routes in 9 years, which presumably means thay are not against “complete privatization of public transport in Dublin”. Have I got this wrong (apologies if I do)? This was the document entitled “A Better Route”.
I’m not criticising this stance entirely. I think that it is such a tension-causing issue that ideology is being left out on all sides and local issues are coming to the fore.
My point is that it seems to me that both sides are pointing to the other and saying that “you are inconsistent” and it is a case of kettle and pot.
My conclusions are my interpretation of the facts as I see them. That the facts seem to conflict is the source of my confusion.
Dan, I don’t believe I am distorting what people are saying and I didn’t make an ad hominem attack on you, so I would thank you to follow suit, please.
The tendering of 25% of Dublin Bus routes would have involved those same routes being re-tendered every 3 years so it would be the same 25% of routes. You don’t honestly expect us to believe that you thought FG was suggesting that the tender would be awarded in perpetuity?
As for my blog post, it was stating that the internal logic of Aer Lingus working on the basis that they should move to another airport if it meant making more money from that other route (whether that will occur or not is open to question) was valid. What it showed up was the lack of logic to the manner in which state assets vested in the Aer Lingus entity prior to privatisation were taken out of state control under the smokescreen of retaining a “Golden Share” of 25%. Golden shower is more like it. If the government believed as it professed to that access to Heathrow as a hub was a strategic national interest then it would have acted to explore all options to retain the existing access. Indeed Cullen said the state would do exactly that, so what options were explored and why were they rejected in favour of the 25% option?
As for the “ad hominem attack” you cited your confusion as being the result of viewpoints that you were misrepresenting (whether intentionally or not) and you referred to my membership of FG as if you imply there was some great inconsistency between the views I had expressed and that of FG generally. You brought yourself into this.
So according to Dempsey it would be inappropriate for the government as a 25% shareholder to intervene in the commercial decision of Aer Lingus to move slots to Belfast, but somehow it is ok for the government as a 25 shareholder to seek to support another airline in its commercial activities by perhaps granting favours to entice them to take up a commercially viable route from Shannon to Heathrow.
The logic would escape anyone. Whatever Aer Lingus does with those slots is a “commercial decision.” Even if they sold them the government just buy them from someone else — and probably for less cash than they have tied up in their 25 percent share. And what’s the EU commission going to think of a special deal for BMI to go into Shannon, which increasingly seems like the main idea on the table?